Ethics Case Study of the Week: What’s On Your Computer Screen?

By Gary Sarkissian posted 17 days ago

CFA Institute’s Code of Ethics and Standards of Professional Conduct outline the ethical guidelines for the investment profession that are critical to maintaining the integrity of capital markets and investor trust.  Members, candidates, and even firms make a commitment to uphold these standards as they help elevate ethical decision-making universally around the globe.  

As investment professionals, we face important ethical decisions in our day-to-day activities.  Some scenarios we encounter will be straightforward, while others may be more complex.  No matter the circumstances, continuous learning remains imperative in an evolving investment industry and an adapting regulatory environment. 

For that reason, each week we feature a sample case from CFA Institute’s Ethics in Practice Casebook.  Many cases are built upon real-life examples that may involve a regulatory matter or even a CFA Institute Professional Conduct investigation.  At the end of each case is a multiple-choice question that addresses the ethical nature of the actions taken in that case.  

This week’s case involves Standards IV(A) Loyalty and I(D) Misconduct.

What’s On Your Computer Screen?
Ziegenthaler is an analyst and trader for a large global asset management firm. The president and CEO of the firm is a legendary figure in the investment industry and appears regularly on global financial television programs as a commentator. Videos of these appearances routinely show the CEO sitting in the firm’s trading room with the traders’ workstations featured in the background. Ziegenthaler’s workstation and computer screen are often clearly visible during the CEO’s television appearances.

In addition to working as an analyst for the firm, Ziegenthaler is a passionate supporter of an animal rights organization that protests the use of animal fur and hides by the fashion industry. During the CEO’s next television appearance, and unnoticed by the program’s producers, Ziegenthaler pulls up a graphic anti-fur poster on her computer screen so that it can be seen by viewers. Several of the firm’s clients, including members of the family of a prominent fashion house, are offended by the graphic and complain to the firm. Ziegenthaler’s actions are

 A. inappropriate because she was using employer resources without permission.
 B. inappropriate because her actions reflected poorly on her professional reputation or integrity.
 C. appropriate because she is free to express her personal views on a topic unrelated to work.
 D. appropriate because her actions did not cause financial harm to her employer.
 E. none of the above.

What do you think is the correct choice?  Click the “Analysis” button below to see the analysis for this case, and feel free to discuss in the comments below.  The completion of this case qualifies for 0.25 hour of Standards, Ethics, and Regulation (SER) credit

This case relates to the professional conduct of an investment professional and her duty to her employer. CFA Institute Standard of Professional Conduct IV(A): Loyalty (to employer) requires CFA Institute members to act for the benefit of their employer and not cause harm to their employer. In addition, Standard I(D): Misconduct states that CFA Institute members must not commit any act that reflects adversely on their professional reputation or integrity. As a general matter, investment professionals are free to voice and act on their political beliefs outside of their work environment. Standard I(D) is not meant to curtail freedom of expression or address conduct (or even acts of civil disobedience) in support of personal beliefs as long as that conduct does not reflect poorly on the member’s professional reputation or competence.

Ziegenthaler’s beliefs related to animal rights, in and of themselves, are not related to her professional competence and do not reflect poorly on her reputation or integrity. But in this case, Ziegenthaler surreptitiously uses resources and a platform made available to her through her employer to express and promote her views. These actions caused her employer at least some reputational harm with its clients, as evidenced by their complaints. As a result, Ziegenthaler’s actions are inappropriate. Choice A is the best answer.

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© 2019 CFA Institute. All rights reserved. You may copy and distribute this content, without modification and for non-commercial purposes, provided you attribute the content to CFA Institute and retain this copyright notice.  This case was written as a basis for discussion and is not prescriptive of how a business situation or professional conduct matter should or should not be handled or addressed. Certain characters mentioned are fictional to facilitate discussion, and any resemblance to actual persons is coincidental.